Correlation Between GM and Inner Mongolia
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By analyzing existing cross correlation between General Motors and Inner Mongolia Furui, you can compare the effects of market volatilities on GM and Inner Mongolia and check how they will diversify away market risk if combined in the same portfolio for a given time horizon. You can also utilize pair trading strategies of matching a long position in GM with a short position of Inner Mongolia. Check out your portfolio center. Please also check ongoing floating volatility patterns of GM and Inner Mongolia.
Diversification Opportunities for GM and Inner Mongolia
-0.11 | Correlation Coefficient |
Good diversification
The 3 months correlation between GM and Inner is -0.11. Overlapping area represents the amount of risk that can be diversified away by holding General Motors and Inner Mongolia Furui in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Inner Mongolia Furui and GM is a relative statistical measure of the degree to which these equity instruments tend to move together. The correlation coefficient measures the extent to which returns on General Motors are associated (or correlated) with Inner Mongolia. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Inner Mongolia Furui has no effect on the direction of GM i.e., GM and Inner Mongolia go up and down completely randomly.
Pair Corralation between GM and Inner Mongolia
Allowing for the 90-day total investment horizon General Motors is expected to generate 0.57 times more return on investment than Inner Mongolia. However, General Motors is 1.76 times less risky than Inner Mongolia. It trades about 0.07 of its potential returns per unit of risk. Inner Mongolia Furui is currently generating about -0.25 per unit of risk. If you would invest 5,273 in General Motors on August 29, 2024 and sell it today you would earn a total of 206.00 from holding General Motors or generate 3.91% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
General Motors vs. Inner Mongolia Furui
Performance |
| Timeline |
| General Motors |
| Inner Mongolia Furui |
GM and Inner Mongolia Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with GM and Inner Mongolia
The main advantage of trading using opposite GM and Inner Mongolia positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if GM position performs unexpectedly, Inner Mongolia can make up some of the losses. Pair trading also minimizes risk from directional movements in the market. For example, if an entire industry or sector drops because of unexpected headlines, the short position in Inner Mongolia will offset losses from the drop in Inner Mongolia's long position.The idea behind General Motors and Inner Mongolia Furui pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.| Inner Mongolia vs. YLZ Information Tech | Inner Mongolia vs. Hangzhou Gisway Information | Inner Mongolia vs. Jinling Hotel Corp | Inner Mongolia vs. Eastern Communications Co |
Check out your portfolio center.Note that this page's information should be used as a complementary analysis to find the right mix of equity instruments to add to your existing portfolios or create a brand new portfolio. You can also try the Competition Analyzer module to analyze and compare many basic indicators for a group of related or unrelated entities.
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